Business area Construction

With local roots close to customers business area Construction does construction work for both external and internal customers. Construction projects include everything from new production of housing, public and commercial premises to renovations and extensions as well as construction maintenance.

Operations in business area Construction are run via some 150 local offices around the Nordic region, organized in twelve regions in Sweden, three in Norway and two in Finland. There are specialized housing production units in Stockholm, Gothenburg and the Öresund region. Construction maintenance operations are a nationwide organization in Sweden focused on the big city areas. Other regions are responsible for all types of construction projects in their geographic area.

Net sales and profit

October – December 2023

Net sales for the fourth quarter 2023 decreased by 16 percent and amounted to SEK 7,029 million (8,330). The reduction is primarily due to a lower demand in new production of housing in all countries. The decline is most notable in Norway and Finland.

In order to handle the diminished housing market we are streamlining construction production and shifting to other kinds of projects. During the quarter a review has resulted in provisions and write-downs in housing projects received before the outbreak of war in Ukraine that have been affected by price hikes and are almost completed as well as a number of projects in Norway. All in all this has charged business area Construction by SEK -465 million kronor, of which write-​​downs of goodwill in Norwegian construction operations amount to SEK -125 million. Operating profit amounted to SEK -358 million (166) and the operating margin was -5.1 percent (2.0).

January – December 2023

Net sales for 2023 amounted to SEK 27,780 million (28,999).

The lower demand for new housing production has not been fully compensated by other types of projects, which is apparent in all the countries we operate in. Housing generated the largest portion of net sales with 39 percent (43).

A decision in the case between Peab and Unibail Rodamco Westfield regarding the contract for Mall of Scandinavia in Solna (MoS) was handed down on June 30, 2023. The judgement had a positive effect on operating profit of SEK 400 million in the second quarter. For details see Other information.

In order to handle the diminished housing market we are streamlining construction production and shifting to other kinds of projects. During the fourth quarter a review has resulted in provisions and write-downs in housing projects received before the outbreak of war in Ukraine that have been affected by price hikes and are almost completed as well as a number of projects in Norway. All in all this has charged business area Construction by SEK -465 million, of which write-​​downs of goodwill in Norwegian construction operations amounted to SEK -125 million. Operating profit excl. MoS was SEK 41 million (629) and the operating margin was 0.1 percent. (2.2). Operating profit was SEK 441 million and the operating margin was 1.6 percent.

Orders received and order backlog

October – December 2023

The level of orders received contracted during the fourth quarter and amounted to SEK 5,835 million (6,321). The portion of housing projects in orders received has decreased. The level of orders received from public customers continued to be good during the quarter.

January – December 2023

Orders received during 2023 were SEK 22,779 million (27,732). There is a greater portion of other building construction and a lower portion of housing projects in orders received. Order backlog on December 31, 2023 amounted to SEK 24,469 million (29,064). The portion of housing projects in order backlog has contracted and represented 32 percent (45).